Personal care manufacturers adopt AI to gain product differentiation in natural fragrances: report

Natural fragrances

SANTA CLARA, Calif. — Frost & Sullivan’s recent analysis, Growth Opportunities for Natural Fragrances in Personal Care, finds that the rise in interest for vegan perfumes, animal testing-free fragrances, and organically certified personal and beauty care products is significantly driving the growth of this industry.

In addition, the fragrance technology segment has been characterized by significant innovations in natural fragrance and renewable ingredient development over the past three years.

“The fragrance technology segment is highly consolidated and is led by a few major global flavor and fragrance houses that drive the innovation landscape based on the needs of brands and end consumers,” said Monami Dey, technical insights research analyst at Frost & Sullivan, in a prepared statement. “Nowadays, consumers are more inclined towards COSMOS-, ECOCERT-, and HALAL-certified natural and organic products. Moreover, we witness an increase in demand for products with more transparency on the ingredients label.”

Dey added: “Innovation in technology is catalyzing the companies to adopt the use of artificial intelligence (AI) tools in the natural fragrance industry, which enables the digitization of product development and efficient production. Additionally, the benefit of using AI in fragrance creation is that it shortens the decision-making process by providing a quick suggestion for alternative formulas or ingredients.”

Major players in the personal care industry are investing in research & development (R&D) activities, which results in rapid changes in the landscape. To stay ahead of the competition, Frost & Sullivan believes that businesses should:

• Develop partnerships with global players to enter new demographics such as India, Malaysia, and the Middle East, improve profit margins and increase the geographical footprint to cater to diverse customer needs.
• Leverage digital tools such as AI to develop new raw material combinations and customization of fragrances to create more value for customers.
• Utilize steam distillation to produce essential oils from plants, exploring biosynthetic pathways to produce environment-friendly as well as biodegradable raw materials.
• Invest in start-ups that produce animal testing-free natural fragrance ingredients or products to improve their product portfolio, as well as academia to nurture innovation of natural fragrance molecules.